Which of the following variables are included in the Black-Scholes call option pricing formula? I.put premium II.N(d₁) III.exercise price IV.stock price A)III and IV only B)I, II, and IV only C)II, III, and IV only D)I, III, and IV only E)I, II, III, and IV

Question

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The Black-Scholes call option pricing formula includes the exercise price, stock price, and the value N(d₁), which is a function of the stock price, time to expiration, volatility, and risk-free rate. The premium is not directly included in the formula as it is the price that a buyer pays for the option and is determined by the market demand and supply of the option. Therefore, II, III, and IV are included, but I is not.

Which of the Following Variables Are Included in the Black-Scholes